Davis left the B&O railroad in 1858 to pursue the coal and timber industry. Davis and his brother gained wealth during the Civil War as their land was valuable because it was easily accessible to supply the army with food and other various supplies. Most of Davis' political agenda dealt with the development of the railroad; he gained political power to have more control over the placement of the railroad and to expand his wealth through the coal and timber industries. Davis was elected to the House of Delegates in 1865 and then the West Virginia Senate in 1868. After helping the Democratic Party take hold, Davis became the first West Virginian Democratic U.S. senator in 1871 and served until 1883.
After his voluntary retirement from the Senate, Davis again focused on the railroad. It was during this time between retirement and his vice president candidacy that he extended the West Virginia Central and Pittsburgh through Tucker, Barbour and Pocahontas Counties until he had connected his road with the Baltimore and Ohio on the western side of the mountains, and also with the Chesapeake and Ohio. This development led to founding of Elkins. After much persistence, Davis became the Democratic vice president candidate alongside Alton B. Parker in 1904. Parker chose Davis primarily on Davis' wealth and ability to fund the campaign. They lost to the Republican campaign of Theodore Roosevelt and Charles Fairbanks.
Henry Gassasway Davis' wife passed in 1902, leaving their daughter Grace responsible for taking care of the house during the summers that her family spent there. Grace died in a tragic car accident in 1931 and left Graceland in the hands of her children, Ellen Bruce Lee and her husband, John A. Kennedy. Graceland was a men's residence hall for thirty years after the West Virginia Presbyterian Education Fund gifted it to Davis & Elkins College in 1941. The home was not in use for nearly 20 years from 1971 to 1990. The Graceland Inn started renovating in 1990 and finally opened in 1996. The Graceland Inn is furnished with antiques and Victorian style furniture, and has dining, wifi, and conference rooms available.